KATHMANDU: Nepal News presents today’s snapshot of Nepal’s economic activities. Get quick updates on major market movements, policy shifts, and financial developments shaping the economy of Nepal. Here are the key economic highlights for today:

NEPSE Edges Up Marginally Despite Political Turmoil in Nepali Congress:
The Nepal Stock Exchange (NEPSE) posted a marginal gain of 0.89 points last week, closing at 2,641.43 despite political uncertainty within the Nepali Congress. Trading was limited to three days due to public holidays, with the index opening the week on a negative note before posting modest gains in the following sessions. Five of the 13 sectoral indices declined, led by microfinance, while hydropower emerged as the top gainer. Radhi Bidyut Company recorded the highest turnover, while Three Star Hydropower was the biggest gainer among individual stocks. Overall turnover fell sharply, but market capitalization rose slightly, adding Rs 1.49 billion in investor wealth.

Social Security Fund Pays Out Over Rs 18.34 Billion to Contributors Since 2019:
Nepal’s Social Security Fund (SSF) has disbursed more than Rs 18.34 billion to 262,264 contributors since contribution collection began in mid-July 2019, according to official data. The payouts cover health, accident, disability, dependent family, old-age security, and voluntary contribution schemes. As of January 13, 2026, the SSF has registered 2.74 million contributors, the majority from foreign employment following mandatory enrollment for labor permits. Total collections have reached Rs 99.56 billion. While participation from the formal sector is growing, enrollment from the informal and self-employed sectors remains minimal, highlighting ongoing coverage challenges despite expanding benefits and financial strength.

Nepal’s Health Insurance Program Faces Risk of Closure Amid Payment Delays:
Nepal’s nationwide health insurance program, covering 3.3 million households and 10 million citizens, faces the risk of suspension due to delayed government payments. Launched in 2016 from two districts, the program now spans 77 districts and 753 local levels. Hospitals, including Tribhuvan University Teaching Hospital, have halted services as pending claims remain unpaid—up to 54% of claims are pending due to budget shortages. Without timely government support, more hospitals may stop services, threatening public trust and program sustainability.

Budget Preparation for FY 2083/84 Begins as Resource Estimation Process Kicks Off:
Nepal has formally begun preparations for the budget of fiscal year 2083/84, with the National Resource Estimation Committee initiating its work to identify available resources and set expenditure ceilings. The process is being led by the National Planning Commission in coordination with the Ministry of Finance, in line with the Financial Procedure and Fiscal Responsibility Act, 2020. As required, preliminary estimates of revenue sources and spending for the next three years will inform the medium-term expenditure framework and annual budget. A technical committee has already started macroeconomic analysis, requesting data from key institutions including Nepal Rastra Bank and the National Statistics Office.

Nepal Rastra Bank Governor Holds Talks with Police and Bankers Amid Rising Risks to Financial Stability:
Nepal Rastra Bank (NRB) Governor Dr. Bishwanath Paudel held high-level discussions with Nepal Police and banking sector leaders after recent incidents and reports raised concerns about potential instability in the financial system. The meeting, attended by Police Chief Dan Bahadur Karki and chief executives of banks and financial institutions, focused on safeguarding banks, depositors, and employees. NRB emphasized coordinated action among regulators, banks, and police to prevent disruptions, ensure lawful loan recovery, and address threats against bankers. With elections approaching, banks were advised to maintain restraint, strengthen security measures, and promptly report incidents to authorities to maintain confidence in the banking system.

Nepal Rastra Bank Issues Unified Directive on Microfinance Capital and Lending Limits:
Nepal Rastra Bank has issued a unified directive for “Category D” licensed microfinance institutions, requiring a minimum 4% core capital and 8% total capital based on risk-weighted assets. It defines eligible capital components, excludes certain reserves, and mandates regular internal audit certification. The directive sets strict lending limits: wholesale loans cannot exceed 25% of core capital per client or related group, while retail loans for low-income, micro-enterprises, renewable energy, and women are capped per borrower. Violations trigger corrective actions, restrict dividend distribution, and require full loss provisioning for over-limit loans. The rules aim to strengthen capital adequacy, risk management, and responsible lending.

Nepal Rastra Bank Issues Unified Directive on Loan Restructuring and Rescheduling:
Nepal Rastra Bank has issued a unified directive consolidating all previous circulars on loan rescheduling and restructuring for licensed banks and financial institutions. Under the directive, loans affected by extraordinary events—including the Jan Andolan protests, natural disasters, and infrastructure delays—can be restructured at the borrower’s request after assessing impact, cash flow, and viability. Interest collection may be partially retained (5–10%), and restructured loans must maintain their original classification until the next review period. Non-performing loans returning to regular status will require a three-month monitoring period before upgrading, ensuring consistency in loss provisioning and maintaining financial discipline.

Nepal Rastra Bank Revises Loan Classification Rules for Non-Performing Loans:
Nepal Rastra Bank has issued new directives allowing loans classified as non-performing (inactive) to be upgraded directly to the “good” category three months after full repayment of principal and interest. Previously, such loans were moved to a watch-list category for six months before being reclassified as good. Under the updated guidelines, banks and financial institutions must ensure that restructured or reclassified loans outside restructuring schemes, once fully repaid, are monitored for three months while remaining in their current classification—substandard, doubtful, or loss—before they can be upgraded. The move aims to simplify loan recovery and reclassification processes.

Midyear Review Shows Nepal’s Budget Execution and Revenue Collection Lagging:
Halfway through the current fiscal year, Nepal’s budget implementation and revenue performance remain weak, according to the Office of the Financial Comptroller General. By mid-January, only 38.38 percent of the Rs 1.964 trillion annual budget had been implemented, while revenue collection stood at Rs 588.51 billion, resulting in a budget deficit exceeding Rs 102 billion. Capital expenditure is particularly poor, with just 12.12 percent of the development budget spent despite half the fiscal year having passed. In contrast, spending on public debt servicing is relatively high, reflecting growing fiscal pressure and limited progress on development priorities.

After Three Decades, Nepal Opens Power Trading to Private Sector, Ending NEA Monopoly:
Nepal’s electricity sector has entered a new era after the Electricity Regulatory Commission issued the Open Access Directive 2082, allowing the private sector to trade power using the Nepal Electricity Authority’s transmission system. The move formally ends NEA’s decades-long monopoly and shifts the market from a single-buyer model to a competitive multi-buyer, multi-seller framework. Private producers can now sell electricity directly to industrial and commercial consumers, easing long-standing PPA and market-access bottlenecks. While stakeholders have welcomed the reform, full implementation will take time due to pending technical standards, pricing mechanisms, and infrastructure readiness.

Government Approves Investment Modality for 1,200 MW Budhigandaki Reservoir Hydropower Project:
The Ministry of Finance has approved the investment modality for the 1,200 MW Budhigandaki reservoir hydropower project in Dhading and Gorkha, enabling the Ministry of Energy, Water Resources, and Irrigation to proceed with further steps. With a base cost of $277 million (approx. Rs 374 billion) and total construction cost including interest of Rs 406 billion, the project will be implemented over eight years. The financing plan proposes a 70:30 debt-to-equity ratio, with the government holding 80% and Nepal Electricity Authority 20% of shares. The dam will create a 63 km² reservoir, generate 3.38 billion units annually, and significantly contribute to Nepal’s energy security and regional development.

NHPC Requests Rs 40 Billion Viability Gap Fund for West Seti Hydropower Project:
Indian state-owned NHPC Limited has requested Rs 40 billion from Nepal’s Investment Board as a Viability Gap Fund (VGF) for the West Seti hydropower project, citing financial non-viability and the obligation to provide 21.9% free electricity. VGF, allowed under Nepal’s Public-Private Partnership and Investment Act, supports infrastructure projects with long-term benefits but limited short-term returns. The West Seti project’s Detailed Project Report (DPR) has been submitted, and the Investment Board is studying it. The project, initially planned at 750 MW and now upgraded to 800 MW, had previously faced delays, including termination of a contract with China Three Gorges International Corporation.

Nepal and Bangladesh Move to Revive Preferential Trade Agreement, Address Tariff Barriers:
Nepal and Bangladesh have agreed to expedite signing a bilateral Preferential Trade Agreement (PTA) after years of stalled negotiations due to tariff and para-tariff disputes. The eighth commerce secretary-level meeting in Dhaka decided to convene Nepal’s Trade Negotiation Committee within three months to finalise the draft PTA, rules of origin, and product lists. Both sides also agreed to harmonise customs procedures, facilitate cross-border payments, remove non-tariff barriers, and promote tourism and investment cooperation. Nepal’s exports to Bangladesh rose 20 percent last year, but high para-tariffs—sometimes raising duties to over 130 percent—remain a major hurdle for Nepali products seeking greater market access.

Nepal Electricity Authority to Host AI Hackathon to Drive Digital Transformation:
The Nepal Electricity Authority (NEA) is set to organize the “AI Hackathon Program 2082” under the theme “NEA AI Vision: Powering Tomorrow,” aiming to accelerate digital transformation, innovation, and performance improvement. The initiative seeks AI-based, practical solutions to NEA’s real operational, managerial, and technical challenges, with an emphasis on secure, cost-effective deployment within its own data centers. NEA employees from all offices can participate in teams of up to five by submitting concept proposals within 30 days. Selected teams will pitch prototypes, with top performers receiving recognition and overseas AI training opportunities.

Bagmati Province Capital Spending Remains Low at Under 9% in First Half of FY 2025/26:
The Bagmati provincial government has spent just 8.99 percent of its capital budget in the first six months of fiscal year 2025/26, reflecting slow progress on development projects. Overall budget utilization from mid-July to mid-January reached 14.10 percent, down 2.17 percentage points from the previous year. Recurrent expenditure performed better at 22.48 percent. Of the total Rs. 67.4 billion budget, Rs. 9.58 billion has been spent, with the highest expenditures recorded by the Public Service Commission (36.35%), the Office of the Chief Attorney (30.80%), and the Provincial Assembly Secretariat (29.35%). Economists warn that low capital spending may slow provincial development initiatives.

Gandaki Province Spends Only 16.7% of Budget in First Half of Fiscal Year:
Gandaki Province has spent just 16.68 percent of its total budget in the first six months of the current fiscal year, reflecting a decline in both budget size and spending capacity. According to the Provincial Treasury Controller’s Office, NPR 5.33 billion has been spent out of the total NPR 31.98 billion budget by mid-January. This is lower than last year’s 19.36 percent expenditure during the same period. Capital expenditure remains particularly weak, with only NPR 2.69 billion spent from a capital budget of NPR 19.10 billion, raising concerns over stalled development projects.

19 Insurance Companies Announce Dividends for FY 2081/82 in Nepal:
For the fiscal year 2081/82, a total of 19 insurance companies in Nepal have declared dividends, including 11 life and 8 non-life insurers. Life insurers such as Asian Life, IME Life, Nepal Life, and LIC Nepal announced total dividends ranging from 5% to 21.05%, combining bonus shares and cash payouts. Non-life insurers, including Neco Insurance, Siddhartha Premier, and Shikhar Insurance, declared dividends between 5% and 25%, mostly in cash. These distributions come from profits earned in the previous fiscal year, with annual general meetings completed. The dividends reflect healthy profitability and shareholder returns across Nepal’s insurance sector.

Nepal Opens Industrial Import of Betel Nut, Cardamom, and Pepper with Regulatory Oversight:
The Government of Nepal has allowed the import of betel nut, cardamom, and black and white pepper for industrial purposes in FY 2082/83. Importers must obtain mandatory recommendations from the Department of Industry, which will verify the industrial necessity, availability, and quantity required. Newly established industries must provide registration, tax, and production details, while existing industries must submit past import, production, and utilization records. The move aims to ensure these raw materials are used solely for industrial processing, curb illegal imports, and streamline supply for domestic manufacturing. Previous notices from FY 2081/82 have been canceled.

Nagdhunga–Naubise Tunnel Nears Operation, Landslide Delays Opening Until April:
Nepal’s first tunnel road connecting Kathmandu and Dhading via the Nagdhunga–Naubise section of the Prithvi Highway is close to operation but has faced delays despite claims it would open before Dashain. With 98 percent physical progress completed, major systems—including lighting, ventilation, fire safety, emergency response, and RFID-based electronic toll collection—are already installed. The main cause of delay is a landslide at the Dhading-side western portal, affecting about 150 meters of road. Retaining walls and slope stabilization works are underway. Officials say the tunnel will open by April. The Rs 23 billion, JICA-funded project has already seen multiple deadline extensions.

Commercial Banks’ Non-Banking Assets Soar to Over Rs 43 Billion in First Five Months of FY 2082/83:
Nepal’s 19 commercial banks have accumulated Rs 43.05 billion in non-banking assets by mid-December 2082/83, marking a 31.83% rise from Rs 32.65 billion during the same period last year, according to Nepal Rastra Bank. Fifteen banks saw growth, with Prime and Nepal SBI showing the largest increases, while Kumari, Machhapuchhre, Everest, and Rastriya banks experienced declines. Global IME Bank holds the highest non-banking assets at Rs 5.997 billion, followed by Himalayan Bank (Rs 5.9216 billion) and NIC Asia Bank (Rs 4.3946 billion). Nepal Bank recorded the lowest at Rs 264.2 million. Standard Chartered Bank reported no non-banking assets.

16 Commercial Banks Pay CEOs Nearly NPR 32 Crore in FY 2080/81:
Sixteen commercial banks in Nepal paid their CEOs a combined total of NPR 31.95 crore in the fiscal year 2080/81, according to annual reports. Prabhu Bank topped the list, compensating CEO Ashok Sherchan NPR 4.34 crore, including salary, bonuses, and festival allowances. NIC Asia Bank and Kumari Bank had yet to hold general assemblies, while Standard Chartered and Rastriya Banijya Bank have not published reports. CEO remuneration across banks ranged from NPR 63 lakh at Nepal Bank to nearly NPR 3.89 crore at Nepal Investment Mega Bank. Payments included salary, allowances, bonuses, and non-cash benefits such as vehicles and medical coverage.

Frequent ATM Failures Frustrate Bank Customers Across Kathmandu Valley:
Customers across Kathmandu Valley are increasingly frustrated by malfunctioning ATMs operated by banks and financial institutions. Common issues include cards getting stuck, cash not dispensing, blank screens, network failures, and complete shutdowns. In areas like Kupundol, Kapan, Kalanki, Koteshwor, Balaju, Baneshwor, and Maharajgunj, people often leave ATMs empty-handed despite having sufficient funds. Students, daily wage workers, and small business owners face repeated inconvenience. Banks acknowledge problems stem from outdated machines, insufficient cash management, delayed maintenance, software issues, and limited technical staff. Despite claims of 24-hour service, many ATMs remain unreliable, disrupting daily banking for thousands of residents.

Jagadamba Motors Launches Nepal’s First TVS Apache Racing Experience:
Jagadamba Motors Pvt. Ltd. has announced Nepal’s first Apache Racing Experience (ARE) to celebrate the 20th anniversary of the TVS Apache series. The program offers motorcycle enthusiasts professional racing training, including cornering, precision braking, throttle control, posture, and bike handling techniques. Top performers will represent Nepal in India’s Madras International Circuit One-Make Championship. Drawing on over 40 years of TVS Racing expertise, the initiative aims to promote motorsports culture, develop local talent, and provide structured skill-building opportunities. Participants will also receive safety gear, training, and enjoy networking, entertainment, and food stalls, making it a complete experiential platform for riders.

Rabi Lamichhane Case Reversal Sparks Fears of FATF Grey List Risks for Nepal:
Attorney General Sabita Bhandari approved the withdrawal of organized crime and money laundering charges against Rastriya Swatantra Party chairman Rabi Lamichhane, raising concerns over Nepal’s commitment to exit the Financial Action Task Force (FATF) grey list. Legal experts argue the move undermines past criminal investigations, violates legal principles, and could set a precedent weakening future anti-money laundering enforcement. Nepal Bar Association condemned the decision, highlighting risks to judicial independence. Critics warn that reversing high-profile cases may jeopardize Nepal’s international credibility, impede FATF-related reforms, and negatively impact ongoing investigations into corruption and financial crimes.

Gold Jumps Rs 9,400 per Tola in a Week as Global Uncertainty Lifts Precious Metals:
Gold prices in Nepal surged sharply last week, rising by Rs 9,400 per tola to close at Rs 277,200, according to the Federation of Nepal Gold and Silver Dealers’ Association (FENEGOSIDA). The price climbed steadily through the week, with gains on most trading days despite a brief midweek correction. FENEGOSIDA attributed the rise to persistent geopolitical tensions, expectations of US interest rate cuts, increased gold buying by central banks, and global economic uncertainty pushing investors toward safe-haven assets. Silver prices also rose by Rs 865 per tola, briefly hitting a historic high of Rs 5,655, driven by strong industrial demand and China’s export restrictions.

Nepal Telecom-Bank Scandal Exposes Corporate Governance and Regulatory Gaps:
Recent irregularities in Nepal’s telecom and banking sectors have raised alarms over corporate governance and state revenue protection. A “toxic” triangle between Ncell, the failed Smart Telecom, and Nepal Investment Mega Bank (NIMB) centers on Satishlal Acharya and his family, who allegedly coordinated financial maneuvers to protect private interests while leaving state dues unpaid. Despite Smart Telecom’s license revocation, NPR 500 million in loans was repaid through NIMB, bypassing regulatory oversight. Experts warn this highlights systemic gaps in transparency, regulatory enforcement, and risk management, underscoring long-term financial vulnerabilities in Nepal’s banking and corporate sectors.

Pokhara International Airport Sees 950,000 Passengers in 2025 Amid Declining Air Travel:
Pokhara International Airport handled 946,745 passengers in 2025, a decline from 1,019,919 in 2024, as improved road connectivity to Pokhara reduces reliance on air travel. Of the 2025 total, 176,567 were international passengers—the highest recorded so far—but overall international traffic remains low at just 2,880. Domestic flights have increased, with daily services to Kathmandu, Bharatpur, Bhairahawa, and Nepalgunj operated by Buddha Air and Yeti Airlines. The expansion of the Pokhara–Muglin highway has shortened travel times significantly, influencing the drop in air passenger numbers. Despite limited international flights, Pokhara benefits from strong domestic connectivity and peak-season traffic exceeding 4,300 passengers per day.

Workshop Flags Lack of Coordination and Clear Narrative as Key Weakness in Nepal’s Tourism Branding:
A recent workshop jointly organized by the Nepal Tourism Board and Ministry of Foreign Affairs concluded that Nepal’s tourism image has not been effectively established internationally due to weak coordination among public, economic, and cultural diplomacy, inconsistent promotional strategies, and the absence of a clear national narrative. Experts highlighted fragmented efforts between diplomatic missions, government agencies, and the private sector, limiting soft-power potential and reducing global impact. The workshop recommended integrated strategies, fact-based promotion, targeted market approaches, and collaborative content creation to position Nepal as a “lifetime experience destination.” Institutional alignment and consistent storytelling were deemed critical for strengthening Nepal’s international brand.

Rasuwa District Sees Over 32,000 Tourists in Six Months, Boosting Local Economy:
Rasuwa district welcomed 32,671 tourists—26,787 domestic and 5,884 international—between mid-July 2025 and mid-January 2026, with Gosainkunda and the Langtang region emerging as major attractions. Tourism revenue during this period reached Rs. 23.9 million, driven by entry fees of Rs. 3,000 for foreigners and Rs. 100 for Nepali visitors. Officials expect the total number of visitors to reach 50,000 by the end of the fiscal year, up from 44,000 last year. Local communities, including hotels, farmers, and laborers, have benefited from the increased tourist inflow, highlighting the growing economic and cultural importance of Rasuwa’s Himalayan destinations.

Broom Grass Farmers in Northern Morang Hit by Falling Prices Despite Rising Exports:
Farmers in northern Morang are struggling as broom grass (amliso) prices have plummeted from Rs. 130 per kg four years ago to Rs. 45–48 per kg this year, squeezing incomes despite increased production. Transportation and labor costs further reduce profits, forcing farmers to accept whatever prices traders offer. Letang market traders report low demand from India, the main export market, although exports to Bangladesh have begun this year. In fiscal year 2024/25, 15,193 tonnes worth Rs. 1.15 billion were exported to India. Farmers and traders warn that without price stabilization and stronger market access, the staple cash crop for the region will continue to undermine livelihoods.

Pokhara Moves Towards Cable-Free Streets with Underground Electricity and Internet Lines:
The six-lane section from Pokhara International Airport to Prithvi Chowk is now free of electricity poles and overhead internet wires as part of the Pokhara–Bharatpur Distribution System Strengthening Project. The Nepal Electricity Authority has connected around 600 households through underground cables, with work ongoing in Lakeside and key market areas. Tata Projects is laying 23 km of underground electricity, telephone, and internet cables at a cost of Rs. 2.53 billion. The metropolis is coordinating with internet providers for shared underground infrastructure and plans to remove unnecessary wires. Project officials aim to complete the major works by June 30, 2026, enhancing both utility services and city aesthetics.

Dharan’s Waste-to-Energy Project Shuts Down Amid Policy Gaps and Government Inaction:
The Venture Waste to Energy project in Dharan has shut down just months after becoming operational, highlighting policy and governance failures in Nepal’s alternative energy sector. Launched under a tripartite agreement eight years ago, the Rs. 240 million project aimed to convert organic waste into biogas and fertiliser. Despite receiving subsidies and completing successful trials, the plant has remained closed for four months due to the absence of clear government policies on gas sales. Project operators and local officials blame federal neglect, legal ambiguity and administrative delays. With Dharan generating up to 50 tonnes of waste daily, the shutdown has forced the city back to temporary dumping, undermining efforts to build a clean and sustainable urban system.

Deal Reached to Relocate Houses, Clearing Way for Madan Bhandari Highway in Morang:
An agreement has been reached to relocate nine households obstructing the Morang section of the Madan Bhandari Highway, easing a major hurdle in the National Pride Project. Kerabari Rural Municipality has committed to identifying land for resettlement and coordinating compensation through the Morang District Administration Office. Road construction had stalled in Bhaluwa despite the clearance of more than 1,300 trees along a 9.42-km stretch. Project officials say 87 percent of physical progress has been achieved, with no budget constraints and Rs. 8 billion already disbursed. Contractors expect work to accelerate once the road’s right of way is fully cleared, aiming for rapid progress by mid-July.

Jet Boat Rides Draw Crowds at Ruru Fair, Boosting Tourism in Ridi:
Jet boat rides have become a major attraction at the Ruru Fair in Ridi, the confluence of Gulmi, Palpa and Syangja districts, with 683 people enjoying the experience within the first three hours on opening day. Local youths from Ruru Kshetra have jointly launched the service by creating a temporary artificial lake, investing Rs. 10 million. Two jet boats are currently in operation, with plans for a permanent RCC dam next year. The initiative has added a new tourism dimension to the religious hub of Ruru Dham, which already attracts thousands of pilgrims, especially during Maghe Sankranti. Local leaders say the project will be further developed after addressing legal and environmental issues.

From Local Produce to Profitable Enterprise, a Woman Entrepreneur Drives Her Own Success in Tanahun:
Dhan Maya Rana Magar of Bhimad Municipality–6, Tanahun, has built a thriving pickle business by producing, marketing and delivering her products herself. Since starting commercial production in 2018, she has achieved an annual turnover of nearly Rs. 800,000, earning about Rs. 400,000 in net income. Using locally available ingredients, she produces a wide range of vegetarian and non-vegetarian pickles and employs three people. By personally driving her vehicle to markets across Tanahun and Pokhara, she has eliminated market barriers. Local industry leaders hail her as a courageous role model, inspiring other women to pursue entrepreneurship and economic self-reliance.